Author: Luke A. Wake
Today Judge George Steeh, a Clinton appointee, handed down a rulingin a Michigan challenge to the PPACA's mandate that individuals must purchase health insurance. Like PLF, the Thomas More Law Center is challenging the individual mandate on the ground that Congress exceeded the scope of its commerce power under the Constitution by requiring individuals to purchase health insurance against their will. In defending that mandate, the government has raised three procedural defenses: (1) individual plaintiffs lack standing because the mandate is not effective until 2014, (2) challenges to the individual mandate are not ripe until 2014, and (3) the Anti-Injunction Act bars any claim that the mandate is an unconstitutional tax. On the merits, the government has argued that the choice not to purchase health insurance is an action that may be regulated under the Commerce Clause, and that the mandate may-in the alternative-be justified under Congress' taxing power.
The good news is that the Court has rejected the government's procedural defenses. This bodes well for our client, Matt Sissel, and similarly situated litagants across the country. Moreover, on the merits, the court endorsed PLF's argument that the individual mandate amounts to a penalty, not a tax, which means that it cannot be justified under Congress' taxing power.
Unfortunately, the Court endorsed the governments argument on the merits of the Commerce Clause issue, holding that the commerce power entails the power to force individuals to buy health insurance because they are already participants in the health care market. The opinion states that:
"The health care market is unlike other markets. No one can guarantee his or her health or ensure that he or she will never participate in the health care market. Indeed, the opposite is nearly always true. The question is how participants in the health care market pay for medical expenses – through insurance, or an attempt to pay out of pocket with a backstop of uncompensated care funded by third parties."
"This phenomenon of cost-shifting is what makes the health care market unique. Far from "inactivity," by choosing to forgo insurance plaintiffs are making an economic decision to try to pay for health care services later, out of pocket, rather than now through the purchase of insurance, collectively shifting billions of dollars, $43 billion in 2008, onto other market participants…"
"The plaintiffs have not opted out of the health care services market because, as living beings, who do not oppose medical services on religious grounds, they cannot opt out of this market. As inseparable and integral members of the health care services market, plaintiffs have made a choice regarding the method of payment for the services they expect to receive. The government makes the apropos analogy of paying by credit card rather than by check. How participants in the health care services market pay for such services has a documented impact on interstate commerce. Obviously, this market reality forms the rational basis for Congressional action designed to reduce the number of uninsureds."
This reasoning is flawed. The choice not to purchase health insurance is not an activity. While it is true that most of us will-at some point-need medical care, we are not active participants in the market for medical care until we purchase health insurance or actively seek medical attention.
The opinion suggests that the decision not to purchase health insurance is a decision about how to pay for health care, but that is not so. It is simply a decision against one possible way of financing health care, which one may or may not ever need.The opinion suggests that this somehow ammounts to a decision to shift costs to third parties, but that is not so either. Cost shifting cannot occur unless an individual engages in an activity effecting a cost shift, and no one disputes that Congress could regulate such activities.
Surely Congress could regulate how we may go about obtaining medical care, or how we pay for medical care, because Congress has the power to regulate actions affecting interstate commerce under the Commerce Clause. But, Congress does not have the power to compel individuals who have taken no action to become market participants. Put simply, Congress can't regulate our client because he has yet to take an action affecting interstate commerce.
The mandate does not regulate the action of obtaining medical care, or the action of paying for medical care. Instead it seeks to compel individuals into action. This is not a regulation on an activity at all, but a prohibition against inactivity.